Monocytes are critical precursors of dendritic cells and macrophages, which play an important role in the pathogenesis of human immunodeficiency virus type 1 (HIV-1). HIV-1 postentry infection is blocked in undifferentiated monocytes in vitro, while the underlying mechanisms are not fully understood. HIV-1 Tat-mediated transactivation of the viral long terminal repeat (LTR) promoter is essential for HIV-1 transcription. Two critical cellular cofactors of HIV-1 Tat, cyclin T1 (CycT1) and cyclin-dependent kinase 9 (CDK9), are required for LTR-directed HIV-1 transcription. In addition to the previously identified restrictions in early viral life cycle, we find that HIV-1 gene expression is impaired in undifferentiated primary monocytes. Transfection of monocytes by nucleofection with HIV-1 proviral DNA could not produce infectious HIV-1. The lack of Tat transactivation of the LTR promoter correlated with the impaired HIV-1 gene expression in monocytes. Interestingly, heterokaryons between primary monocytes and a human embryonic kidney cell line restored Tat transactivation of LTR, suggesting that monocytes lack cellular factors required for Tat transactivation. CycT1 protein was undetectable in freshly isolated monocytes and induced in monocyte-differentiated macrophages, while the expression of CDK9 remained constant. Transient expression of CycT1 in undifferentiated monocytes could not rescue Tat transactivation, suggesting that CycT1 is not the only limiting factor of HIV-1 infection in monocytes. Furthermore, monocyte differentiation into macrophages appeared to enhance the phosphorylation of CDK9, which correlated with significantly increased HIV-1 infection in macrophages. Our results provide new insights into HIV-1 infection and regulation in primary monocytes and viral pathogenesis.